PETALING JAYA: T7 Global Bhd
’s newly secured maintenance, construction and modification (MCM) contracts are expected to strengthen the group’s revenue in the financial year of 2026 (FY26), in line with management’s plans to improve cash flow and reduce net gearing.
“The company is targeting to reduce its gearing level to around two times by the end of 2026, which should gradually ease finance costs over time,” BIMB Research said.
T7 Global recorded a notable rise in finance costs in 2025, propelled by borrowings to fund asset preparation and support working capital for the new MCM contracts.
As at end-2025, the group’s net gearing position stood at three times, with net debt of RM1.5bil, the research house said.
Moving forward, BIMB Research noted the group is likely to prioritise service-based work such as MCM, hook-up and commissioning (HUC) and decommissioning projects, as opposed to capital-intensive projects.
It added that T7 Global’s order book remains robust at RM3.8bil, and positively backed by long-term contracts within the mobile offshore production unit, MCM and decommissioning spaces.
At present, the group’s tender book stands at around RM7bil, including three leases and charter of floating offshore asset projects.
Across its energy segment, T7 Global has witnessed revenue growth, driven mainly by higher well plug and abandonment (P&A) activities, as well as facilities decommissioning work for Malaysian upstream oil and gas company Hibiscus Petroleum.
The research house said P&A activities boosted revenue by 127% year-on-year (y-o-y) to RM183mil.
“Notably, the company completed P&A of 32 wells out of a total 60 wells completed industry-wide, representing a 50% market share.
“In addition, the commencement of MCM contracts contributed to revenue growth, albeit at a slower rate of 35% y-o-y to RM222mil.”
It said offshore maintenance remains the largest contributor to the segment, making up about 40% of the revenue.
Looking ahead, the research house said T7 Global’s FY26 should be a stronger year as key offshore projects move into a more active execution phase, particularly within the MCM scope.
Petroliam Nasional Bhd (PETRONAS) is also expected to shift upstream spending to Peninsular Malaysia, partly due to uncertainties in Sarawak.
“This should benefit T7 Global, particularly under the C1 HUC package, which was previously affected by delay in PETRONAS’ capital expenditure spending,” it said.
The group’s FY25 net profits rose by a modest 8.5% y-o-y to RM46.8mil, attributed largely to stronger performance from its energy segment.
“However, overall bottom-line growth was partly offset by weaker performance in the industrial solution segment, mainly due to delays in the Kuala Lumpur International Airport baggage handling system project, and higher finance cost due to drawdown in borrowings to support new MCM contracts,” it added.
Meanwhile, revenue jumped to RM554mil, marking a 52% increase y-o-y.
BIMB Research maintained a “buy” call with a target price of 40 sen, highlighting that the current valuation was undemanding, given its earnings visibility and expanding operational footprint.
